Senior officers and councillors at Edinburgh City Council must ‘accelerate its transformation and change programme' to save £100m by 2029, auditors say.
The Accounts Commission found that the council had made progress and many of its services were performing well.
However, it warned the council had to address declining performance in areas such as housing, waste and some aspects of street cleaning.
The commission also said the council had ‘ambitious plans' to borrow money to improve housing and school buildings, but cautioned these would have to be ‘managed carefully'.
Jo Armstrong, chair of the Accounts Commission, said: ‘The council has successfully achieved savings over recent years. But given increasing demand and financial pressures, the council must accelerate its transformation and change programme. Listening to and acting on the views of staff and local communities will be vital.
‘The council has real opportunities, including the potential to raise more income. It shouldn't use the potential of future income, however, to delay making difficult decisions now as challenges will only intensify.'
Council leader Cammy Day said the council had delivered a lot of change at a time of 'huge pressure' on services, but acknowledged there was still much more to be done.
A spokesperson for the council also said that the local authority was querying the way the commission has interpreted the data on which it has based its opinion about the performance of some of the council's services.
